Sand mining firms told to renew licenses

JAKARTA (JP): Minister of Mines and Energy Kuntoro Mangkusubroto has given sand quarrying companies off Batam Island until June 6 this year to renew their licenses.

Kuntoro said on Friday the ministry would restructure sand quarrying operations off the island to allow a larger number of companies to quarry sand there.

He said under the new licenses, the five sand quarrying companies currently operating in Batam and its surroundings will only be allowed to own contract areas of 5,000 hectare each,

Currently, the five companies control 169,580 hectares of contract areas.

The companies are PT Citra Harapan Abadi, which has a quarrying contract on 7,738 hectares; PT Equator Reka Citra, which has 12 contract areas covering 65,980 hectares; and PT Barelang Sugi Bulan, which has four contract areas totaling 50,702 hectares.

The other companies are PT Bumi Samudra Argomegah, with one contract area of 19,250 hectares, and PT Batamatma Mandrasakti, with one contract area of 25,910 hectares.

The rights to issue licenses to mine sand in Batam and its neighboring isles were formerly held by the Batam Industrial Development Authority but the ministry took over the rights last July.

According to the ministry's data, the five companies quarried 312.6 million cubic meters of sand from the area up to July, giving the authority S$287.6 million (US$165.2 million) in royalties.

All the sand was exported to Singapore.

Kuntoro said the government would take over 144,580 hectares of sand quarrying areas from the five companies, which it will put into open bids, to be held by next month.

Winners of contract areas will have to pay the government a certain amount in fees for the data on the contract areas within five days of winning the contract areas.

If the companies cannot pay the data fee on schedule, the government will disqualify them and will not return their registration expenses.

"The sand contract areas will only be given to applicants which can prove their ability and seriousness to conduct explorations," Kuntoro said. (jsk)